Billionaire business owner Yvon Chouinard has given away his successful outdoor clothing company to a charitable trust, meaning that he and his family are now the most charitable family in America.
The Story Behind Patagonia
Founded by Chouinard in 1973, the company specializes in high-quality, sustainable outdoor clothing. It has been nearly 50 years since Patagonia’s establishment, and over that time the brand has become extremely popular – especially amongst the environmentally conscious.
In its early days, the business was inspired by Chouinard’s love of rock climbing. He initially started out by selling metal climbing spikes to his friends and fellow rock climbers, which gradually developed into creating outdoor clothing.
Chouinard’s love of the outdoors and commitment to leading a simple, environmentally-friendly life sets him apart from most other billionaire businessmen.
In fact, he was appalled when discovering he was added to the Forbes List in 2017, viewing that as a personal failure in his life’s mission to make the world a better place.
Hence, he decided it was time to relinquish all personal gain from the business.
So What Does This Mean For Climate Change Charities?
Rather than selling the company or making it not-for-profit, Chouinard and his family have instead transferred their ownership to a specially established trust and nonprofit organization.
The Chouniards transferred all of their voting stock into the Patagonia Purpose Trust, which oversees the company’s lasting commitment to social and climate reform.
The common shares (which equate to about 98% of the company) were then donated to a nonprofit organization called the Holdfast Collective. This charity is now the sole recipient of all the company’s profits, which will be used towards combatting climate change.
Chouinard’s commitment to climate action is not just performative or secretly self-serving. In fact, because the family donated their shares to a trust, they must pay $17.5 million in taxes on the gift.
Obviously, this is not a lot to a man with an estimated net worth of $1.2bn. Nevertheless, it shows moral consistency and commitment to his personal values of environmental protection and social justice.
“Hopefully this will influence a new form of capitalism that doesn’t end up with a few rich people and a bunch of poor people”
Yvon Chouinard for The New York Times
Chouinard also declared to his staff and customers that “Earth is now our only shareholder” clearly outlining his intentions to be fully committed to environmental causes.
A Step In The Right Direction
Chouinard, now aged 83, will hopefully be an inspiration to other successful business owners to use their abundance of wealth wisely.
The founder’s total relinquishment of his own company is an unusual and unprecedented step toward signaling support for climate action. Considering many other billionaire business owners only donate a small fraction of their earnings to charities every year, this is a bold and praiseworthy statement.
Hopefully, his unconventional approach to capitalism is a reminder that the Earth is the “source of all wealth”. Without the Earth’s natural resources, we would be nothing – so we need to take measures to protect it.
